Taiwan bets on the heat beneath its feet as geothermal energy emerges as a new power frontier

As surging electricity demand from AI, semiconductor manufacturing and industrial electrification strains Taiwan's energy system, the island is turning to its volcanic geology in search of a stable source of renewable power.

A new energy imperative

Taiwan's energy transition has entered a new phase. While offshore wind and solar photovoltaics have dominated the island's renewable energy agenda over the past decade, policymakers and industry alike are increasingly acknowledging a fundamental limitation: intermittent power alone cannot satisfy the rapidly rising electricity demand of an economy anchored by advanced semiconductor manufacturing and the global AI demand.

In June 2026, Taiwan’s government projected electricity consumption to continue climbing 2.5% annually throughout the coming decade as data centers, chip fabrication plants and high-tech industries expand.

Against this backdrop, geothermal energy — long regarded as an underdeveloped resource despite Taiwan's favorable geology — is receiving attention as one of the possible sources of reliable, around-the-clock renewable electricity.

Unlike wind and solar generation, geothermal plants operate continuously regardless of weather conditions, making them one of the few renewable technologies capable of providing stable baseload power.

According to the Ministry of Economic Affairs' (MOEA’s) Taiwan Geothermal Single Service Window, a total of 17 geothermal sites had received approval as of the end of June 2026.

Most are concentrated in eastern Taiwan, including Taitung, Hualien and Yilan, where the island's geothermal resources are most abundant. Approved sites have also been identified in New Taipei City as well as Taichung and Tainan, reflecting an expansion of geothermal exploration across different regions of the island.

Unlocking Taiwan's geological advantage

Taiwan sits along the Pacific Ring of Fire, where active tectonic movements have endowed the island with abundant underground heat. For decades, however, this natural advantage remained largely untapped.

Historically, geothermal development faced numerous obstacles, including high exploration risks, complicated permitting procedures,  and uncertainty over commercial viability, among others.

Recent policy reforms and stronger government support have begun changing that equation. Taiwan has introduced more comprehensive regulatory frameworks, expanded exploration efforts and encouraged both domestic and international investment.

At the 2026 Taiwan International Geothermal Conference, vice minister of Economic Affairs Lai Chien-hsin (賴建信) said the geopolitical conflict in the Middle East has underscored the vulnerability of global energy supplies and reinforced the importance of strengthening Taiwan's domestic energy resources.

He described geothermal power as a critical pillar of Taiwan's "second energy transition" and an indispensable component of the country's pathway toward net-zero emissions.

Beyond its climate benefits, Lai noted that expanding geothermal generation will also help meet the growing demand for stable renewable electricity from Taiwan's AI-driven industries and its pivotal role in the global AI supply chain.

To accelerate development, the MOEA aims to increase the nation's installed geothermal capacity to 1 GW between 2027 and 2028, with a longer-term target of 6 GW by 2050.

Petroleum and Gas Development and Management Division, the regulatory arm under MOEA's Energy Administration, also stated that in recent years, the government has not only amended legislation and adjusted feed-in tariffs to attract next-generation geothermal energy. It has also extended incentives to local governments and simplified application procedures, with the aim of reaching the 6 GW target by 2050.

The industry remains relatively small today, but several commercial projects have entered development, signaling that geothermal power is gradually moving from concept to reality.

Beyond conventional geothermal

Even more transformative is the emergence of next-generation geothermal technologies.

Traditional geothermal power depends on naturally occurring underground reservoirs containing both sufficient heat and permeable rock formations through which water can circulate. Such geological conditions are relatively rare, limiting where conventional geothermal plants can be built.

Next-generation geothermal systems — including Enhanced Geothermal Systems (EGS), Advanced Geothermal Systems (AGS), and other advanced technologies — seek to overcome these constraints by engineering underground reservoirs or accessing much deeper heat sources. Borrowing innovations from the oil and gas industry, these technologies are deemed to have the potential to dramatically expand the geographic reach of geothermal energy.

Winning community trust one conversation at a time

Technological capability alone, however, does not determine whether geothermal projects succeed. Public acceptance is also critical.

Swedish geothermal developer Baseload Capital, operating in Taiwan through its subsidiary Baseload Power Taiwan, offers a compelling illustration of this reality.

Baseload Capital told TCN’s Mandarin channel NOWNEWS in written comments that the company entered the Taiwan market around 2020.

It said that the company spent five years engaging extensively with local communities before breaking ground on its first major project. Rather than focusing solely on engineering and permitting, Baseload invested considerable effort in public meetings, seminars and door-to-door communication to explain geothermal technology and address residents' concerns.

The company's experience in Hongye Village in Hualien County, eastern Taiwan, underscores the importance of social engagement. According to Baseload Capital, residents initially opposed the project, largely because geothermal energy was unfamiliar to the community.

Questions centered on potential drilling noise, possible impacts on groundwater and the surrounding natural environment.

Baseload responded by committing to transparent communication throughout every construction phase. The company pledged to hold regular public briefings, implement vibration and noise mitigation measures, prioritize local hiring and workforce training, and conduct continuous environmental monitoring while publicly disclosing the results.

Gradually, skepticism gave way to dialogue. As trust developed, community attitudes shifted.

In the village's formal consultation process, residents voted overwhelmingly in favor of the project, approving it by 269 votes to 11.

Following the successful consultation, drilling operations were scheduled to start in 2026, with commercial operation targeted for 2029.

From niche technology to strategic asset

Taiwan's geothermal industry remains in its infancy compared with more established renewable sectors. Exploration risks, substantial upfront investment and lengthy development timelines continue to present formidable challenges.

Nevertheless, the sector's trajectory reflects a broader evolution in Taiwan's energy strategy. Rather than relying on a single renewable technology, policymakers are assembling a more diversified portfolio capable of balancing reliability, sustainability and energy security.

As electricity demand accelerates alongside the island's growing prominence in the global technology supply chain, geothermal energy may prove to be more than another renewable option.

By combining geological advantages, technological innovation and sustained community engagement, Taiwan is laying the foundations for what could become a strategically important pillar of its future energy system.